Thai company CP All PCL is eyeing overseas expansion in China through the increasingly ubiquitous 7-Eleven convenience stores, hoping to replicate the huge success story in the Southeast Asian market it has created over the last two decades.

Bloomberg News

A 7-Eleven convenience store in Thailand

After enjoying rapid domestic expansion, the operator of the 7-Eleven chain in Thailand is seeking approval from U.S.-based franchise owner 7-Eleven Inc. to start running the stores in China, CP All Managing Director Piyawat Titasattavorakul said Wednesday at a news conference. It hopes to get the green light by year-end.

CP All is planning to open 7-Eleven stores in one Chinese city near Shanghai, Mr. Piyawat said, without elaborating on investment details. Different store locations in China are allocated to different franchisees, according to a public relations officer at CP All. There are already hundreds of 7-Eleven stores operating in China, with 177 in Beijing and 102 in Shanghai as of January last year. In Thailand alone, CP All operates 6,800 7-Eleven stores.

At a time of urbanization and as Thailand sees an increasing proportion of the middle-class population, 7-Eleven has been rising rapidly in popularity since 1988, when CP All established the first branch in Thailand.

After getting the go-ahead by the U.S. franchise owner to operate in China, CP All will seek further approval to run 7-Eleven stores in Myanmar, Laos, Cambodia, and Vietnam.

The company’s move can be seen as an early step to fully capture the benefits from regional economic integration as Southeast Asian nations prepare to form the Asean Economic Community at the end of 2015. The bloc will bring together nearly 10% of the world’s population into a shared economy of more than $2 trillion.

CP All is a unit of Charoen Pokphand Group, controlled by Thai tycoon Dhanin Chearavanont. CP Group, which has a vast interest in agricultural, livestock, and feedmill businesses in Thailand and China, is now struggling to pass a $9.4 billion deal to purchase a 15.7% stake in Ping An Insurance (Group) Co. of China Ltd. from HSBC Holdings PLC. The deal, if it sails through, would be the biggest-ever overseas acquisition deal by a Thai firm.

Expanding into foreign markets could prove to be fruitful in the long run but it is likely to weigh on CP All’s profitability in the near term, analysts say.

“In the short-term, the company has to invest and test consumer behavior in those countries and it may not book profit during the initial stage. However, the plan will help drive the company’s earnings growth in the long term,” Asia Plus Securities’ Vice President of Research Kawee Manitsupavong said.

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Indonesia Real Time provides analysis and insight into the region, which includes Singapore, Thailand, Indonesia, Vietnam, Malaysia, the Philippines, Myanmar, Cambodia, Laos and Brunei. Contact the editors at SEAsia@wsj.com.

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